Moving into mum's house- shared ownership

[Sendcoffeestat]

My mum and I have been discussing splitting her very large home with me and my family moving into one bit while she would live in the other.

We're looking at this being a shared ownership with all financial responsibilities split fairly. My mum has got a solicitor who is going to do the paperwork and act in her interest. We haven't yet appointed a solicitor. I suppose naively I just see the benefits so don't see the need for legal representation. But then there would be questions of what happened if my DH and I got divorced or if I were to die before him or my mum.

Just wondered if anyone has ever done anything similar and if there was any advice or if anyone could think of other potential issues we should consider? Thanks

Deprivation of assets.

www.ageuk.org.uk/information-advice/care/paying-for-care/paying-for-a-care-home/deprivation-of-assets/

Someone in my family is going through this now. My cousin moved out of her house and in with her mum, leaving her adult dd in the flat my cousin had.

Then she and her mum lived together in the family home which the mum put in the DD's name. The mum went into a care home eventually and some sort of investigation was done (I think by the council run home but I'm not sure as we are trying to stay out of it really) and now she has to sell the house to pay the fees. It's all a big nightmare as she really has nowhere to go.

If no money changes hands it would be considered a gift from your mum so deprivation of assets comes into play if she was to die relatively soon (used to be 7 years but may have changed). In the case of divorce I'm not sure what you can do, your dh could sign a declaration now saying he would not have any ownership of the house, but that wouldn't be full proof in court, and if you were to die first he inherits from you.

I do think that you need to carefully consider if part owning works for you and ensure your husband is fully onboard and willing to sign that if you and he were to part ways he is willing to wait until after your mum vacates the premises (care home or the ultimate) to settle his share and understand that it's necessary for your mum

I don't think deprivation of assets is seven years. Isn't that inheritance tax? Maybe get this moved to legal though.

I would ask as many questions to solicitor as possible before deciding on doing this. I would think you can use same solicitor and you probably need one that specialises in this, to tell you all everything you need to be aware of eg divorce, care home and care giving to your Mum in later years and also change of mind.

A couple more what-ifs to think about.

What if your mum had to go into residential care? Do you have the finances to buy her share of the house off her if she needed to sell her share to pay for care? (Or will she have enough house left over to have live-in care if it came to that?)

If your mum dies who will she be leaving her share of the house to? Do you have siblings?

What if you hate living with your mum but your mum loves it, or vice versa?

What if you and your mum disagree about something like works to the roof?

Will you be expected to become her carer as she ages? That could become a nightmare and ruin your relationship. Boundaries blur as people become older. Expectations change. Have seen it happen.

Thanks so much for your replies. Really useful.

Hopefully, part of the plan is that it will avoid my mum needing to go into a home. At least until the very end and again, hopefully, this could be covered by income. But of course you never know what will happen so thanks for the deprivation of assets stuff.

My husband is very very reasonable and has said that he wouldn't pursue the house in case of divorce (we have another property which he could have) but this would need to be written down- a post nup?

I think my death would be tricky in terms of responsibility to my mum. Again, I'm sure my husband wouldn't turf her out but best to have it in writing. I was thinking it might be best for my third to be left to my children?

I think you're right this needs to be in legal... How do I do that?!

Oh in terms of eg roof repairs, these would be split 60/40 or 70/30 to match the ownership.

@cptartapp yes, to becoming a carer but with any help financially available to us eg a nurse etc.

@Sendcoffeestat please do this legally with a deed of trust. Your mum is being really sensible in getting legal advice and planning to do this formally.

I know it may seem excessive but it protects everyone and hopefully avoids difficult situations in the future. No one can predict the future so thinking through what happens in a range of scenarios can make difficult decisions much easier because they have already been discussed.

@Foreversearch I absolutely agree. Everything as legal as possible. I know I'm not going to screw my mum over but I still want to prevent it, if you see what I mean!

Oh in terms of eg roof repairs, these would be split 60/40 or 70/30 to match the ownership.

I think @LadyGardenersQuestionTime means what if your mum wants a new roof and you don't think it's necessary or one of you can't afford it. Not how would you split it.

You will need tens of thousands of pounds to ensure you would be able to pay for care in her own home.

My uncle has Alzheimer's and could not stay living at home with his family as he was unsafe. He is otherwise healthy and could be in his care home for years and years. In this situation you would have to have (or do yourself) twenty four hour care.

Oh sorry with the roof thing, it's a bit complicated but that wouldn't be an issue. With other things though it could be...eg the house needs considerable updating and reconfiguring to make it work (eg an additional kitchen). The modifications to make it "our house" would be on us but other bits eg new wiring... We'd need to figure that out.

I'm sorry about your uncle @YellowDots the family on my mum's side had dementia but were able to live independently with support. I guess I need to think more worst case scenario.

Again, thanks all for your very useful input

You definitely need a solicitor to go through the pros and cons and to protect all of you.

People get confused with IHT and deprivation of assets. There is no timescale for deprivation of assets

But in any case this could be avoided by you paying for your part of the house rather than your mum gifting it to you

Deprivation of assets has no end date as far as I know

It's massively complicated and there are all kinds of issues that could come up in the future.

You need expert guidance from someone who can talk through all the potential scenarios that wouldn't even occur to you. And even then, think again. Every penny that you pay to a lawyer (and it needs to be an expert in this field) will be worth it.
I'm speaking from experience of a shared ownership situation with a parent with fewer complications than yours (she doesn't live there). And it's a major headache.

The council tax might increase if it is seen as two separate dwellings.

It may be that you buy a share of your Mum's property and then she pays you for the care you provide. That legally works and represents what is actually happening.

Try and view it as if you were both buying new properties next door to each other, then how would you be doing it?

There is a risk that your Mum's health deteriorates suddenly and extremely but continues to live for a long time yet such as severe stroke. Would her property be suitable, so you want to be a full time cater tied to the house for 20/30+ years?

You absolutely need legal advice. Older people have a habit of getting more selfish even if they don't get dementia, so your rational mum now might not always be. You say you will take on care for as long as possible to keep her out of a residential home and associated fees. There could be unexpected sudden illnesses that need more care than you can provide. My friend's dad had a stroke and then couldn't be trusted alone as he would turn the gas oven on, leave taps running, go for a walk in the middle of the night etc. If she does need long term care and has gifted you the house then you may be pursued for deprivation of assets. It is absolutely possible, just needs to be properly reviewed beforehand.

A few years ago when I was working in litigation we had a client in his late 50s who had lived at home his whole life. When his Dad passed away in the early 90s his mum put half the house in his name as tenants in common. He'd been living there with his parents since he was a toddler and had owned half the house for over 20 years when the council came after it. His mum had only been in care for two months at that stage but her savings were running out.

I left before it was resolved but always wondered what happened. He was a lovely man who had led a very sheltered life. He had a job that paid ok (around 26k a year) but didn't drive, had never been abroad and had never left the family home. It was a standard sized 3 bed terraced house worth about £230k at the time. He wasn't holding on to some sort of family estate worth millions. The council argued he had enough equity to move out and get himself a flat with a small mortgage so there was no reason to deprive them of the cost of her care fees.

On a practical side you would need an additional water supply, gas supply and electricity supply so that the 2 households could function independently of each other.

Be very careful about this.

Elderly people, no matter how active and independent in life, can get progressively infirm.

If your mother had a stroke, got dementia etc she could become doubly incontinent, her personality can change and need full time care. Care home fees cost £1300 a week plus.

The responsibility and stress for providing full time care 24/7 on you and your family would be extreme.

Houses can be fitted with special steps, bath rails, stairlifts etc but if your mum became immobile and needed a wheelchair and was unable to use the bathroom unaided, you are going to have to think through the practicalities.

Getting carers in is also expensive and not always satisfactory.

Sorry this all seems to be a downer but a lot of people have a romantic notion of granny moving in and eventually passing away happy and surrounded by loved ones with being independent and able to do things, look after herself until passing away peacefully in her sleep.

Unfortunately this is not the reality 85% of the time.

Once someone loses their mobility it's a game changer.

If they regularly go for walks and hike, are sociable, have a real zest for life, have good hand eye coordination, good memory, good hearing, good eyesight, good sense of humour then go for it if you must.

Otherwise not a good idea.

Thanks. Some good points. The house, even with adaption, would be tricky with a wheelchair... I suppose I'm only thinking of more basic care because that's what my grandparents needed

My mum, at 73, had a massive and disabling stroke. She is paralysed down one side and needs two carers to hoist her, and requires a hospital type bed.
How would you deal with that? Your mum would need to go into a care home almost overnight, and deprivation of assets would quickly become an issue.

This is what I meant in my earlier post, about getting legal advice from someone who specialises in this area, and has the experience to run through all the different scenarios that could pesent themselves.